Tuesday January 28th

28-01-2020

US stock futures point to rebound after worst drop since October

U.S. stock index futures pointed on Tuesday to a rebound for Wall Street after the market’s biggest sell-off in more than three months as investors grapple with lingering fears over a possible coronavirus outbreak. At around 7:40 a.m. ET, Dow Jones Industrial Average futures were up 145 points and indicated a gain of 137 points at the open. S&P 500 and Nasdaq 100 futures also rose. “Stocks are attempting to stabilize and rebound although the effort is quite tentative and lacks conviction,” said Adam Crisafulli, founder of Vital Knowledge, in a note. The move higher in futures follows the Dow and S&P 500′s biggest drop since October on Monday. The Dow plunged more than 450 points while the S&P 500 logged in its first pullback of at least 1% in 74 sessions. The Nasdaq Composite also had its biggest one-day decline since August amid fears the spreading coronavirus could hurt the global economy. In China, where the virus originated from, the virus has killed more than 100 people while over 4,500 have been infected. In the U.S. — where some coronavirus cases have been confirmed — the State Department advised Americans to “reconsider travel to China due to the novel coronavirus.” President Donald Trump also said the U.S. is in “very close communication” as it relates to the virus. Meanwhile, the corporate earnings season continued with 3M, Pfizer and Harley-Davidson releasing their quarterly numbers. Pfizer and 3M posted disappointing earnings for the previous quarter, sending their shares down 1.4% and 2.3%, respectively. Harley-Davidson’s earnings per share beat expectations, but a disappointing revenue figure helped send the stock down 7% in the premarket. Of the S&P 500 companies that have reported thus far, 67% have posted better-than-expected earnings, FactSet data shows. Apple is among the S&P 500 components set to report after Tuesday’s close. On the data front, durable goods are set to be out at 8:30 a.m. ET. Consumer confidence figures alongside the Richmond and Dallas Fed surveys are expected at 10 a.m. ET. Stocks in Asia declined on Tuesday amid fears about the ongoing coronavirus outbreak that continues to spread. South Korea’s Kospi dropped 3.09% to close at 2,176.72. In Japan, the Nikkei 225 shed 0.55% to close at 23,215.71 while the Topix index declined 0.6% to end its trading day at 1,692.28. Markets in China and Hong Kong were closed on Tuesday for holidays. Oil futures moved higher on Tuesday following five straight days of losses, as output outages in Libya and OPEC comments designed to calm demand fears curbed the heavy sell-off of recent sessions. U.S. West Texas Intermediate rose 30 cents, or 0.5%, to trade at $53.44 per barrel, after slipping to its lowest since early October in the previous session at $52.13. Brent crude gained 13 cents, or 0.2%, to trade at $59.45 per barrel, having hit a three-month low of $58.50 on Monday as the virus outbreak triggered a global sell-off of riskier assets. Both contracts are on track for their worst monthly falls since May. Gold prices edged down on Tuesday from the previous session’s near three-week high as equities regained some ground, but concerns the coronavirus outbreak could impact the global economy cushioned safe-haven bullion’s losses. Spot gold was down 0.2% to $1,578.95 per ounce, having touched its highest since Jan. 8 on Monday. U.S. gold futures were up 0.1% to $1,578.60.